Fresh on the heels of their big night at the Crunchies Awards Friday night, today Automattic announces a big new $30MM financing.

Details of the round are over at Matt’s and Toni’s blogs, and covered by GigaOm and The Wall Street Journal.

What’s fun for me is that the Automattic story is such a good illustration of how seed deals are supposed to work.

A couple years ago Om Malik and Tony Conrad introduced me to then 20 year old Matt Mullenweg, who had just moved to San Francisco from Texas to work for CNET. Nights and weekends Matt also led an tecchie open source software project called WordPress. After — literally — watching the download counter spinning like mad at Matt’s party celebrating the release of WordPress 1.5, I knew there was something pretty special going on. Without really having much of a clue where it might lead, but knowing that Matt was a rare talent who I would want to get to work with, we helped Matt incorporate Automattic and led a small seed investment in the company, along with Phil Black (then Blacksmith Capital and now True Ventures) and former Kleiner Perkins partners Doug Mackenzie and Kevin Compton.

From there it was off to the races. Nearly concurrent with the funding, Matt found an awesome partner — Toni Schneider, who had been CEO of Oddpost, and then, after Yahoo acquired Oddpost, went on to run the Yahoo Developer Network. It is not everyday that a tiny seedling of a startup hires a CEO with Toni’s chops, let alone as one of the very first founders! Over the course of the following year Automattic quietly brought on a crop of the very best WordPress developers from around the world, as well as Raanan-Bar Cohen, a senior exec from Dow Jones Digital.

Later, one weekend Matt decided he didn’t want his Mom to have to deal with blog spam, so he created Akismet, the world’s first anti webspam service. To date, Akismet has stopped 4,311,783,380 spams. And a few months after our funding, Matt launched a hosted service for the WordPress publishing tool. Two years later, the service hosts over 2 Million blogs, which create more than 100,000 posts per day and see more than 100 million unique visitors each month.

WordPress had gone from an open source publishing tool to a massively scaled web service. As this trajectory became more clear, Matt and Toni began to spend more cycles thinking seriously about the future of Automattic, and now have developed a plan to build Automattic into a substantial Internet platform business.

Much to the delight of the investors, everyone has agreed that now is the time to invest against this objective so that the company can hire the right talent and dedicate the appropriate resources. As a result, my partners and I are tickled to have the opportunity to follow what two years ago was a tiny seed investment in a brilliant kid with an interesting experiment, with a quite large investment in what we feel pretty confident is going to be an important and valuable Internet platform.

5 Comments

A nice story indeed and a model for how to raise capital appropriately aligned with progress of the company. It’s exciting to be a part of Automattic and to watch how brilliantly Matt, Toni and the gang have navigated all aspects of the business: product, culture, model. Companies like Automattic are a great reminded how lucky we are to participate at the table.

VCMike, wordpress should be giving sphere some love and integrating them deeply in wordpress. my readers value the related twitter streams and would love sphere-strength content to complement. why no auto-integration? not ready for prime-time on one side or the other? cheers! silva